How Deductibles Work
With any type of health insurance, the insured has a deductible that must be met before the insurance company covers expenses. When the deductible is reached, the insurance company then starts contributing to any other medical bills for the rest of the year. The deductible ensures that policyholders do not file frivolous claims. It also ensures that the insured pays some out-of-pocket cost before the insurance company pays anything.
A family plan has a minimum number of family members who must meet an individual deductible to count as a family deductible. Once the family deductible has been met, any additional member of the family can get medical expenses paid for by the company.
How Individual and Family Deductibles Work Together
With polices that have an individual and a family deductible, calculating benefits can be confusing. For example, say you incur $2,000 worth of individual medical expenses on a plan that has an individual deductible of $1,500. Your child incurs $1,000 worth of expenses and the family deductible is $5,000. Any more individual expenses you incur are covered because you have exceeded the individual deductible of $1,500. Any expenses that your child incurs are your responsibility until the expenses reach $1,500 or your total family's expenses reach $5,000.
No Individual Deductible
Some health insurance plans do not include a deductible for individuals, but have only a cumulative deductible for the entire family. This is usually the case with high-deductible health insurance plans. For example, the entire family deductible might be $5,000 per year. Regardless of which members of the family incur medical expenses that exceed $5,000, the family deductible is counted as satisfied. Then any other member of the family can get medical service paid largely by the insurance company.